Hedge fund chief ditches London Stock Exchange

THE activist investor who whipped up a boardroom battle at the London Stock Exchange last year has quietly sold the bulk of his shares in the company.

Hedge fund manager Sir Chris Hohn owned a 5.1pc stake in the LSE through his firm TCI Fund Management, and was at the centre of a spat when he attempted to oust the exchange’s chairman Donald Brydon last October.

Hohn began his battle after the LSE announced that its chief executive Xavier Rolet was set to leave. The hedge fund manager accused Brydon of forcing Rolet out against his will.

Rolet had been credited with helping the exchange’s market value grow from £800m to more than £14bn during his nine years in charge.

But Hohn’s plan to keep him in place backfired, as Rolet cut his notice period short and resigned immediately to avoid a shareholder vote on his future.

After failing in his bid to reinstate Rolet in his role, Hohn said that the LSE would not find a ‘world class’ chief executive while Brydon remained in power.

The exchange has since appointed former Goldman Sachs banker David Schwimmer, but Hohn has stuck to his guns. He revealed yesterday that he had sold 11.3m shares with a market value of around £12m.

Hohn only owns 1.8pc of the LSE, even though the exchange’s share price has risen 22.5pc since Rolet quit. Its shares ended yesterday down 2.2pc, or 107p, at 4663p.

Despite the boosts afforded to the share price of Sky (up 8.6pc, or 136.5p, to 1721.5p) and Randgold (up 6pc, or 297p, to 5220p), as each soared after receiving weighty takeover offers, the

FTSE 100 ended the day down 0.42pc, or 31.82 points, at 7458.41.

Storm clouds were forming over the travel sector as Thomas Cook blamed the summer heatwave for beating down its profits.

The High Street travel agent plummeted 28.1pc, or 21.85p, to 56p as it said hot weather had led to tough competition and high levels of holiday discounting in recent months. The slump wiped £336m off its market value.

Thomas Cook’s Swiss-born chief executive, Peter Fankhauser, said: ‘Many customers spent June and July enjoying the sunshine at home and put off booking their holidays abroad.’

He said recent trading, which had seen average selling prices 5pc lower than the same time last year, was ‘clearly disappointing’.

Ripples of fear spread across the sector, as investors backed away from rivals Tui and On The Beach. Tui was the FTSE 100’s biggest faller, edging down 3pc, or 42p, to 1382p, while On the Beach dropped 6.1pc, or 31p, to 478p. Oil companies, on the other hand, excelled as Brent crude hit its highest level since November 2014.

The price of Brent crude climbed 3pc on the day to more than $81, after the Saudi Arabia-led oil cartel Opec rejected President Trump’s calls to increase production. On the FTSE 250, Premier Oil rose by 3.7pc, or 4.6p, to 129.3p, Tullow Oil by 2.9pc, or 7.2p, to

254p and Cairn Energy by 2.7pc, or 6p, to 227p.

Investors were less impressed by the performance of asset manager River and Mercantile.

At the end of June the firm was investing £33.8bn on behalf of savers, up 9pc on the first half of last year, but it warned that profits had slipped from £16.4m to £16.1m for the first half of the year.

During that time, River and Mercantile was also forced to sack one of its fund managers, Philip Rodrigs, over ‘problematic conduct’.

Its chief executive Mike Faulkner said the firm had ‘moved past some issues we faced’.

But shares still ended the day down 5.5pc, or 18p, at 312p.